Dear Friends –
This week turned out to be budget week. We learned that on Monday night, saw the two budget documents, totaling over 1300 pages, on Tuesday late morning, and took our first vote about 24 hours later. If you’re thinking, “Wow, that’s fast! How can legislators possibly know everything in the budget?” you’re right: it is fast (although normal for the NCGA) and we can’t know everything. We rely on our colleagues and the legislature’s non-partisan staff to help us understand the provisions, but we were all still learning about other provisions after we voted. It’s no way to pass the single most important piece of legislation we adopt.
So, what’s in the budget? Is it good or bad? How did I vote? I’ll highlight some items below but, as usual, the budget is a mix of good and bad. I will say that this was the least bad budget I’ve seen in my six years here and, even though we could be doing so much more, I voted for it. Interestingly, the votes for and against the budget were bipartisan, not something we often see.
The Good
Let’s start with the fact that we have a budget for the first time in over 1000 days. That alone is pretty good, but there’s also more. Here are some things near and dear to me:
- Another $700,000,000 for Helene relief – private road and bridge repair, local government capital grants, cashflow loans, temporary relocation assistance funding for families whose homes are now being rebuilt, dam repair/removal, wildfire mitigation. It’s never enough, but what’s there is all good.
- Much needed support for childcare that answers the call from advocates
- Funding for food banks and Sunbucks that help feed kids during the summer
- Funding for land conservation, trails, and parks
- Funding for wildlife crossings – more than has ever been awarded before
- Hundreds of millions for water and wastewater infrastructure
- Funding for the Housing Trust Fund and workforce housing loans
The Wish It Were Better
In my comments on the floor, I paraphrased Job and said this budget giveth and it taketh away. We did some good things, but they were either not good enough or the good came at the expense of something else. Here’s what I talked about:
- Funding to restart the Healthy Opportunities Pilot, which uses Medicaid dollars to help people address their upstream needs on housing, transportation, and food. BUT it’s not enough. WNC built a large and effective network to implement this program that served over 13,000 people and actually saved money on medical care. The legislature cut this program last year and has now funded it at only $9 million– a far cry from the $87 million it had before. This drop in funding also leaves over $200 million federal dollars on the table. But at least HOP can get started again.
- We funded the additional costs for the SNAP/food stamps program imposed on the state as part of the federal HR 1 last year, so close to 1.4 million people in NC will continue to receive food stamps. BUT, we did not fund the increased administrative costs to counties, which will cost over $200 million annually across the state – an unfunded mandate from the feds and no help from the state. The state will also begin withholding sales tax from counties that have a high error rate, costing counties another $150 million annually.
- We put more money toward legal representation for poor people in criminal cases, BUT we took that funding away from groups like Legal Aid and Pisgah Legal Services that represent poor people in civil cases – domestic violence survivors, people trying to stay housed, Helene survivors trying to navigate a complex system. Who will represent these people now?
- There is new money for attorneys in the Attorney General’s office, BUT those positions are time limited and are only so they can begin moving death row inmates more quickly toward execution. NC hasn’t executed anyone since 2006, and the system continues to be unjust and racially biased.
- We increased the tax on sports gambling revenue, BUT we also now allow gamblers to itemize and deduct their losses on their income taxes. AND we legalized prediction betting platforms, taxing them at a much lower rate and giving them a sweetheart deal. I predict sports gambling in NC will move to these platforms to take advantage of that sweetheart deal, and the current benefits NC realizes from sports gambling will evaporate.
- We increased the budget for every area of state government, BUT we cut over 700, mostly unfilled positions. Certainly, some of those could go, but there is no recognition that many of these were unfilled because of the state’s low salaries and that agencies need more people to serve our growing state.
- We gave raises to state employees across the board, including teachers, state troopers, and corrections officers who were woefully underpaid. Our starting teacher salary is now about in the middle of the 50 states rather than far below. BUT mid-level and senior teachers didn’t get as much, we gave out a lot of bonuses in place of larger increases, AND these raises were not retroactive to July 2025.
- We delayed the scheduled tax cuts, BUT they are still scheduled to start in 2030, going down from the current 3.99% to 2.99% in 2033, putting our fiscal future at risk.
Bottom line, this budget fills a huge and current need to bring our state spending up to date, and it funds Helene recovery at a significant level, and that’s why I voted for it. BUT there is still so much we need to do, can do, and should do. This is a budget born of a scarcity mindset rather than one of abundance, despite our abundant resources and abundant needs. Even outside of our reserve funds, we are sitting on $3 billion we could put to work today relieving economic pressure on North Carolinians, making food, healthcare, housing, and childcare more available and affordable; investing more in education and infrastructure; paying state workers what they are worth and filling empty positions rather than cutting them. We won’t get those investments now, but I will continue to advocate for them as long as I’m here.
Hemp
We also voted on the conference report for H358 that brings some regulation to the wild, wild west that is modern day hemp/CBD sales. I got emails for and against this bill, and I ended up voting for it for the following reasons:
- The two provisions that become effective immediately are: 1) a ban on sales of these unregulated, intoxicating, possibly toxic products to people under 21; and 2) a ban on the sale of synthetic kratom. No one can reasonably object to keeping intoxicating products out of the hands of kids or banning a substance as dangerous as synthetic kratom. Natural kratom remains legal under this bill.
- The other provisions in the bill that would ban the sale of all intoxicating hemp products (but, importantly, not non-intoxicating CBD products) and make a number of substances illegal, do not become effective until November and December. That is when we will know whether these products will be banned at the federal level. If they are, then they would be banned here too. If they aren’t and congress adopts a reasonable regulatory scheme for their sale, we could do the same here.
So to be clear, nothing will be banned immediately if this bill becomes law. Your business will not be required to close and you can still access the products you use until this fall when there is a decision at the federal level. And we will keep kids from legally purchasing these products at the corner store – something we should have done years ago. Between now and the end of the year, I promise to work with my colleagues to prepare a broader set of rules regarding product labeling, testing, and transparency that we could put into place when we know what the federal government plans to do.
I will note that the House adjourned today without voting on this conference report, so it has no chance of becoming law until the end of July and, if they don’t take it up, it won’t become law at all.
Legislative Schedule
We adjourned today until the week of July 27. When we come back then, we might vote on more veto overrides and more conference reports, as there is still legislative business to do. I would anticipate we would be here only a few days and then adjourn again until after the election. Until late July, have a great 4th of July and do your best to stay cool!
